What is the return on investment of US military spending on Israel?
A recurring theme of Israel’s critics is that were it not for US spending on its war machine, it would be unable to wage genocide. I will leave the genocide issue (sic, I mean non-issue) aside as it has been well covered here and here.
Of course, right now (March 11), the war is going well for Israel and the US. In fact, the Israeli and American air forces are showing a level of coordination enabled by decades of close cooperation between the two militaries. I recall a conversation with an IDF colonel, the commander of a base near Eilat, in 2010, during a mission that gave participants access to high-level military briefings. Tensions between Israel and the US had soured, as they periodically do, and I asked whether this ebb and flow in political posturing affected military operations. The colonel said political leaders come and go, but the cooperation between the Israeli and American militaries is very tight. To quote him, “they need us as much as we need them. We are their eyes and ears in this part of the world.”
Many on both the right and left call for the US to disengage from Israel, especially with respect to defence spending. First, let us look at facts.
Table 1 readily shows the impact of the war in Ukraine, with Russia’s spending also reflecting wartime demands. Israel’s total commitment of 5-6% of GDP amounts to $45 billion in defence spending, reflecting its perpetual need to defend itself and maintain a permanent reserve force. Table 2 elaborates on defence spending as a share of public spending. Unlike other countries that have been free riding under the US military umbrella (and Canada is the most egregious of the lot), Israel has made very substantial commitments to its own defence. The $3.8 billion spent on hardware for US equipment is a fraction of Israel’s total defence budget of about $43 Billion. All U.S. financial aid to any country for military hardware must be spent on U.S.-manufactured equipment by law.
Critics of US defence funding for Israel miss two key points. First, as Table 3 shows, financing sent to Israel does not involve troop deployment. Israel does not want the US to station troops within its borders. The costs of maintaining troop deployments and all the associated support costs for NATO, Japan, and South Korea are orders of magnitude higher than the financing for the hardware it provides to Israel.
Second, and the current joint US/Israeli operations in Iran bear this out, Israel has dramatically improved the equipment platforms it purchased. Examples include:
The F-15 has benefited from Israeli wartime use, resulting in major improvements, including a redesigned cockpit layout, increased range through fuel redesign, improved avionics, new weaponry, helmet-mounted targeting, and structural strengthening.
Because Israel was an early partner in the fighter’s development and had access to its top-secret software suite, the Israeli version of the F-35 is a radically different plane than the model delivered. Improvements include increasing operational range, embedding advanced air defence detection, and integrating the fighter with Israel’s defence network, creating extensive system integration. This proved instrumental in the rapid establishment of air superiority in the 12-day war in 2025.
Image Credit: Robert Sullivan, Getty Images
The THAAD (Terminal High Altitude Area Defence) program has benefited from a joint research and development relationship between Israel and the U.S.
Finally, Iron Dome has contributed to U.S. air defence development, particularly the Tamir interceptor technology, battle management, target discrimination, and the development of a layered air defence system.
No senior military or political official questions the return on investment American gains by funding Israel’s acquisition of U.S. military hardware.
Useful article!